Janet Silvera, Senior Tourism Writer

( L - R ) Gilbert, Guntley-brady

Jamaica has virtually locked itself out of the timeshare market, because of delays in putting legislation in place to guide property developments and protect the interest of investors, who essentially would be buying into a piece of a vacation complex.

A secondary and much smaller factor is the pervasiveness of the large all-inclusive resorts, industry experts tell the Financial Gleaner, who say that product is not accommodative of the needs of the 'home-from-home' market.

One of the concerns acting as disincentive to investment is that vacation home owners have no legal basis now on which to force a developer or principal in a shared complex to consult with them before selling out to another party.

The Jamaica Tourist Board has no local data on timeshare, saying Thursday that the sector was almost non-existent. The JTB, however, alluded to a sister project to the Palmyra in Montego Bay as a possible addition to the timeshare market.

Other sources have said that such a project is under consideration and that it would be partially 'interval ownership'.

The emergence of Palmyra on the Montego Bay market is likely to boost inventory, the JTB said.

Still, Americans in the industry say there is strong demand for timeshare vacations, with one operator advising it has resorted to renting Jamaican properties and rooms to build an inventory and satisfy the demand of clientele.

A balanced approach

"After over 30 years in the market, we have found that the growth in the timeshare industry requires a balanced approach to legislation," said Interval International's lawyer Tom Bell, speaking with the Financial Gleaner on the margins of the 9th Vacation Ownership Investment Conference (VOIC) held in Orlando, Florida, at the top of the month.

"Legislation provides good consumer protection, which is one way to protect the purchaser's deposit during the cooling off period."

That period is the interval allowed an investor to back away from a purchase, which, said Bell, is typically two to three weeks.

Jamaican experts this week confirmed Interval's claim but, with the transition to a new political administration not fully finalised, spoke only on condition of anonymity.

Jamaica has gone as far as setting up a committee to research the industry and examine the protections needed as the precursor to drafting timeshare laws.

But the committee, which the Financial Gleaner was advised, is is under the guidance of executive director in the Tourism Ministry, Carole Guntley-Brady, has been slow in getting the job done.

Guntley-Brady was off the island and not available for comment.

Timeshare is a multibillion dollar industry, earning US$10 billion in the United States in 2006 to reflect year-on-year growth of 16 per cent. The American government also collected US$1 billion of taxes from the sector, according to figures released at the conference.

Jamaica does have a small presence in the market, but those timeshare offerings are mostly hotel rooms set aside by properties like FDR in St. Ann and Beachcomber in Negril for customers who demand a home-setting while on holiday.

The more exclusive Half Moon resort has been in the timeshare market for more than 20 years, but said it only offers a few select rooms to clients.

An independent third party

Bell said for a timeshare sector to thrive, jurisdictions should have some type of mechanism where deposits by purchasers are held by an independent third party such as an escrow agent who protects the deposit during the cooling off period.

The two-to-three weeks is the allowed period for the investor to reconsider and back away from the deal. If the purchaser rescinds, the money is easily returned.

The lawyer said Interval, a timeshare company, also sees protection of the underlying project as equally important to shield the lead investor from the actions of client purchasers.

"For instance, when a developer sells long-term use rights to a purchaser, there is some mechanism in place so that liens or other mortgages cannot detach to the underlying property. Mechanisms have to be put in place to make sure that doesn't happen."

In the meantime Jamaica remains a very important market to Interval International and its members, said Executive Vice-President David Gilbert.

"It is highly demanded by our members," he said, adding however, that his company has had to rent inventory and place them in its system in order to have a presence in Jamaica.

Interval has amassed close to two million members, of which 1.6 are Americans, said Gilbert.

The company sends about 160,000 vacationers to the Caribbean annually, most of which go to Aruba.

He, too, said Jamaica has been a challenge over the years because the regulatory environment does not exist.

Stable market

"Developers who are going to invest in our markets like to be comfortable that the market is stable and will not invest where shoddy operators would operate at the same time."

Qualifying the role of the all-inclusives, which he says have worked very well in other market segments but had not gained popularity in the timeshare segment, Gilbert said those properties do not offer the homey feeling nor amenities that are the signature of timeshare.

He estimates that well over 90 per cent of timeshare inventories have a family kitchen, a feature not offered by most all-inclusive resorts.

Gilbert said too that each time his company does a survey on where their members want to go, the Caribbean comes out as the number one international destination.

Marriott International, one of the largest vacation club operators in the region, has claimed unparalleled success in the market, saying it operates in St. Thomas, United States Virgin Islands, Aruba, St. Kitts and The Bahamas.

Timeshare

Ownership in a resort property or unit that is shared by others.

Individual owners have their own time period - typically one week - in which they can use the facilities, amenities, accommodations and all attributes associated with the resort.

A timeshare is also known as a 'second home'.

An average of 4.4 million citizens of the United States - Jamaica's largest tourist market - own timeshare.